How Section 184 Works
The Office of Loan Guarantee within HUD’s Office of Native American Programs, guarantees the Section 184 home mortgage loans made to Native borrowers.
The loan guarantee assures the lender that its investment will be repaid in full in the event of foreclosure.
The borrower applies for the Section 184 loan with a participating lender, and works with the tribe and Bureau of Indian Affairs if leasing tribal land.
The lender then evaluates the necessary loan documentation and submits the loan for approval to HUD’s Office of Loan Guarantee.
Who is Eligible for 184 Loan?
Any Native American that is a member of a federally recognized tribe
Benefits of the Housing Loan Program:
Low Down Payment:
2.25% on loans over $50,000
1.25% on loans under $50,000
Low Interest Rates:
Based on market rates, not on applicant’s Credit Scores
Fee and Annual Mortgage Insurance:
A one-time 1.5% up front guarantee fee is paid at closing and can be financed into the loan.
In addition, loans with a loan to value of 78% or greater will be subject to an annual .25% mortgage insurance premium.
Network of Approved Lenders:
Network of approved lenders includes national companies and local banks to suit your needs. Lenders have also been trained on Native homeownership.
Protection from predatory lending:
Program monitors the fees that lenders can charge Native borrowers. Section 184 loans cannot be used for Adjustable Rate Mortgages (ARMs).